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Monday, June 25, 2007

Banks Absorb the Swiss Rate Hike

Oh, this is interesting. So the Banks aren't able to pass on the additional costs in the present environment. 80% of mortgages in Hungary are in Swiss Francs.

Hungarian banks are not expected to raise the lending rates of Swiss-denominated loans, despite a 0.25% rate hike by the Swiss central bank yesterday, Napi Gazdaság writes. The key lending rate rose to a six-year high of 2.25%.

Hungary's banks have kept their home loans and mortgage-backed loan rates flat during the last seven quarters as fiscal tightening began. Banks have adopted a wait-and-see attitude in a fragile market environment, as the austerity measures dampened demand for certain loan products, the daily commented.

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